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Monday, June 18, 2007

CBI turns against new EU treaty

A few extracts from CBI Director General Richard Lambert's speech at an event organised by pro-euro groups Centre for European Reform and Business for New Europe, 18 June:

“After talking to hundreds of companies around the UK in the last twelve months here’s my view on how British business views treaty changes, which are going to be discussed this weekend. The fact is the subject almost never comes up. Most companies I’ve talked to think it’s pretty much irrelevant. The reasons for that are pretty plain – if they think of treaty change at all they think of it more in terms of risks than opportunities. They see few potential benefits for business and some potential hazards.”

“And some business people ask the question: do we need these treaties anyway? The failure of the draft Constitution has not has catastrophic consequences, the eurozone economy has been rising at its briskest pace over the last nine months for the first time in some years… the union continues to function, despite the accession of twelve more countries over the last three years. The institutional framework continues to operate, the European Court has not collapsed into chaos, laws get passed, decisions get made. So the question people ask is: isn’t just this all just a total waste of time, a distraction from the real big issues which the union has to face: the current failing trade round, budget reform, energy security and climate change”

“But being on the margins of the treaty change debate does not mean that business is detached from European debates as a whole – far from it.”

“Until the matter is resolved one way or another, the treaty debate is not going to go away. Europe’s leaders will just go on gazing at their navels, engage in endless - and sometimes irritable – internal debate, ignoring the big issues and opportunities that Europe is facing in the big world.”

“The decisions to be taken over the weekend – if a deal is struck among the member states – those decisions will be intensely political in character and there is no political consensus in British business about what kind of trade offs and compromises might be acceptable next weekend, or about how far Mr Blair and Mr Brown could go without promising a referendum. No consensus – so I’m not going to go down that road this morning.”

“The conclusion is that there is a window of opportunity here – but it’s not as a result of treaty change, but through the shifting courses of European politics. For business I think that means getting more involved in European debates where they matter. Being clear about what would make the single market effective, being clear that its member states who need to raise their game and being clear about where we want Europe to act and not to act.” Focussing on those areas where collective action will do more to further Europe’s position of the global stage than if we just go plodding along in our own merry way. I think it’s these issues that the business community really needs to get stuck into, and let’s hope that this will be possible once the dust that is probably going to be raised in the next few weeks has started to settle.”

This is a major blow to the Government. The CBI previously campaigned for the euro, and the Government were hoping that they could hide behind the CBI on the new version of the constitutional treaty. But it looks like the CBI has wisely decided to steer clear of taking flak for the Government. Given that the new version of the text would still cut Britain’s power to block legislation by 30%, and inevitably mean even more costly EU regulation – it is not surprising that the CBI members have “little zeal” for the new version of the constitutional treaty.